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Sprint is axing its oldest and best deal

Published Apr 5th, 2017 5:13PM EDT
Sprint vs Verizon
Image: Shutterstock

For the last three years, Sprint has had one killer deal to try and persuade people to switch. If you walked in off the street with a bill from a competitor, Sprint would offer the same data and minutes for half the price.

But according to a report in the Wall Street Journal, the rise of unlimited data plans is forcing Sprint to end the run of its Switch and Save 50 Percent deal. It’s the end of a historically long-running promotion, and bad news all around for Sprint.

The report quotes industry analyst Jeffrey Moore. He says that Sprint’s offering became “untenable” in the new unlimited-data-heavy market: Sprint’s previous strategy was to use the 50-percent-offer to get customers in the door, and then upsell them to a plan that cost the same as something from AT&T or Verizon, but with more data.

That doesn’t work when customers are switching from an unlimited plan, as there’s nothing left to upsell to. Instead, Sprint is left with customers on years-long unlimited plans for far too cheap, which contributes to Sprint’s ongoing lack of profits.

The recent launch of unlimited data plans by AT&T and Verizon have hit Sprint hard. With a minimal price difference between Sprint and Verizon’s offering, but a very clear difference in network quality, subscribers have been leaving Sprint at a higher-than-expected rate.

The only good news for Sprint is that the sudden burst of competition is forecast to hit the profits of all four major carriers, with Q1 estimates being revised downwards by analysts.